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Compliance Exclusivityrouting rules effective April 1
WASHINGTON (3/9/12)--The Credit Union National Association's (CUNA) CompBlog in a recent post reminded credit unions that the Federal Reserve's Regulation II's debit card network exclusivity and routing requirements are scheduled to come into effect on April 1.

Regulation II implements the provisions of section 920 of the Electronic Funds Transfer Act that govern debit card interchange fees and network routing and exclusivity limitations. The regulation requires a debit card issuer or payment card network to ensure that debit cards can be processed on at least two unaffiliated networks--one signature and one PIN network--if the card has both signature and PIN capabilities.

Alternatively, an issuer could provide a debit card that can be processed on two or more unaffiliated signature networks, but not on any PIN networks, or that can be processed on two or more unaffiliated PIN networks, but not on any signature networks, CompBlog said.

Regulation II also prohibits issuers and payment card networks from limiting a merchant's ability to choose the network on which a transaction is routed, with respect to those networks on which the debit card is enabled to be used. 

The requirements apply to all debit card issuers, regardless of asset size.

The section was added by the Dodd-Frank Wall Street Reform and Consumer Protection Act.

CompBlog noted that many credit unions have already been steadily working with their vendors to comply with Regulation II.

For more on Regulation II, see CUNA's CompBlog by clicking on the resource link.


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